SPRC Turns to Book ฿267Mn of Profit in 3Q due to Lower Cost and Higher FX

Star Petroleum Refining Public Company Limited (SPRC) has reported its 3Q20 consolidated financial statement through the Stock Exchange of Thailand as follows;

SPRC reported a net profit of 267 million baht for the quarter, contrasted to its net loss of 924 million baht in 3Q19. The increase was due to SPRC’s higher gross profit, supported by lower cost of sales and higher foreign exchange.

 

When compared 3Q20 with 3Q19, COVID-19 impacted SPRC’s performance in 3Q20 in both total revenue and refining margin. Total revenue decreased 31% as a result of lower average selling price and lower throughput, market gross refining margin also decreased from US$5.07/bbl in 3Q19 to $1.53/bbl in 3Q20 in response to the decrease in oil consumption demand.

 

However SPRC’s EBITDA and net earnings in 3Q20 were higher than 3Q19 due to higher accounting gross refining reflected from a stock gain due to the increase in oil price during the quarter while oil price decreased during 3Q19 which resulted to a stock loss and consequently resulted to negative earnings in same quarter of last year.

 

There was a slight foreign exchange (excluding derivatives) gain of US$1 million in 3Q20 compared to a slight exchange loss of US$1 million in 2Q20 and foreign exchange gain of US$7 million in 3Q19. Foreign exchange gain in 3Q19 was due to the appreciation of Baht against US$ during such quarters on Baht denominated receivables.

When compared cost of sales for 3Q20 with 2Q20, cost of sale increased 35%, which was in line with the increase in sales revenue but in a higher proportion due to lower product spread over crude cost. Comparing 3Q20 to 3Q19, cost of sales decreased 31%, reflected from lower average cost of crude oil and lower sales volume in this year.